Bombay High Court
The New India Assurance Company ... vs Smt Rama Vishram Gavas on 4 January, 2022
Bench: N. J. Jamadar
FA-112-2013-aw-caf-1999-2013.doc
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
CIVIL APPELLATE JURISDICTION
FIRST APPEAL NO. 112 OF 2013
The New India Assurance Company Ltd. ...Appellant
Versus
1. Rama Vishram Gavas
Age about 60 Years, Occupation : Nil
2. Sou. Sitabai Rama Gavas
Age about 55 Years, Occupation : Household,
3. Sanjay Rama Gawas
Age 27 Years, Occupation : Nil.
4. Ku. Nilima Rama Gavas
Age 27 Years, Occupation : Nil.
5. Prashant Rama Gawas
Age 23 Years, Occupation : Nil.
All R/o. Padave Majgaon,
Taluka Sawantwadi,
Dist. Sindhudurg.
6. Uday Rama Gawas
Age Major,
R/o. House No. 232/2, Upper Jetty,
Near Electricity Department,
Mormugao, Goa South
Goa - 40380. ...Respondents
WITH
CIVIL APPLICATION NO. 1999 OF 2013
IN
FIRST APPEAL NO. 112 OF 2013
1. Rama Vishram Gavas ...Applicants
Digitally
signed by
SAJAKALI
Age about 60 Years, Occupation : Nil (Org. Claimants)
SAJAKALI LIYAKAT
LIYAKAT JAMADAR
JAMADAR Date:
2022.01.04
16:47:43
+0530
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2. Sou. Sitabai Rama Gavas
Age about 55 Years, Occupation : Household,
3. Sanjay Rama Gawas
Age 27 Years, Occupation : Nil.
4. Ku. Nilima Rama Gavas
Age 27 Years, Occupation : Nil.
5. Prashant Rama Gawas
Age 23 Years, Occupation : Nil.
All R/o. Padave Majgaon,
Taluka Sawantwadi,
Dist. Sindhudurg.
IN THE MATTER BETWEEN :-
The New India Assurance Company Ltd. ...Appellant
Versus
Rama Vishram Gavas and Ors. ...Respondents
Mr. D. R. Mahadik, for the Appellant in F.A. and Respondent in Civil
Application.
Mr. Anand S. Patil Advocate for Respondent Nos. 1 to 5 in F.A. and
Applicant in Civil Application.
CORAM : N. J. JAMADAR, J.
RESERVED ON : 22nd OCTOBER, 2021.
PRONOUNCED ON : 4th JANUARY, 2022.
JUDGMENT :
1. Are the dependents of a person, who borrows the motor
cycle from its owner and dies in an accident while riding the said
motor cycle, there being no involvement of any other vehicle,
entitled to compensation under Section 163-A of the Motor Vehicles
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Act, 1988 ("MV Act, 1988"), is the question which wrenches to the
fore in this appeal.
2. The aforesaid question arises in the backdrop of the
following facts:
a) Rajendra Prasad (hereinafter refereed to as "the
deceased"), was the son of respondent Nos. 1 & 2 and brother
of respondent Nos. 3 to 5 (original applicants). He was
employed as inspector (Sampling) with a company, namely,
Quality Services and Solutions, Goa. On 30th June, 2007 at
about 10.00 p.m. the deceased was riding the motor cycle
bearing No. GA-6-B-6667 owned by the respondent No.2-
original opponent No.1 and insured with appellant/insurer/
original opponent No.2, on his way to Vasco. When the deceased
came near Martin Bar Sada, within the limits of Marmgao, he
lost control over the motor cycle and fell down. Eventually the
deceased succumbed to his injuries. The applicants preferred a
claim for compensation under Section 163-A of the MV Act,
1988.
b) The opponent No.1- owner did not resist the claim.
c) The opponent No.2 - insurer resisted the claim by
raising multiple grounds including a contention that the claim
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was not maintainable against the respondent No.2 as it was
filed under Section 163-A of the MV Act, 1988 for the death of
the deceased on account of his own rash and negligent act. The
person responsible for the accident is not entitled to claim
compensation under Section 163-A of the MV Act, 1988. It was
contended that Section 163-A does not alter the legal basis on
which the liability arises under Section 147 of the MV Act,
1988.
d) The learned Member, Motor Accident Claims Tribunal
Sindhudurg, ("the Tribunal") recorded the evidence of
applicant No.1 - Rama. After appraisal of the oral evidence
and the documents tendered for his perusal, the learned
Member was persuaded to allow the application holding, inter
alia, that the deceased died on account of the injuries sustained
in the accident while he was riding the motor cycle bearing No.
GA-6-B-6667, there was no breach of the conditions of contract
of insurance, and, thus, the applicants were entitled to
compensation. Arriving at a multiplicand of Rs.24,000/- and
applying the multiplier of 16 and adding thereto the
compensation under conventional heads, the Tribunal directed
the opponent Nos.1 & 2 to jointly and severally pay a sum of
Rs.3,86,000/- along with interest @ 6% per annum from the
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date of the petition, to the applicants.
e) Being aggrieved by and dissatisfied with the aforesaid
judgment and award, the opponent No.2/insurer is in appeal.
3. The principal ground of challenge in appeal is whether a
person who had borrowed the vehicle from the owner and suffered
death in an accident on account of his own negligence can be said to
be a third party within the meaning of Section 147 and a victim
under Section 163-A of the MV Act, 1988.
4. I have heard Mr. Mahadik,, the learned counsel for the
appellant and Mr. Anand Patil, the learned counsel for respondent
Nos. 1 to 5 - original applicants at length. With the assistance of the
counsels for the parties, I have perused the material on record
including the pleadings, deposition of witness Rama (PW-1) and the
documents tendered before the Tribunal.
5. Before adverting to consider the submissions canvased
across the bar it may be apposite to note uncontroverted facts. First
and foremost, it is the case of the applicants that the deceased was
riding the motor cycle bearing No. GA-6-B-6667 and met with an
accident as he lost control over the said motor cycle. No other
vehicle was even remotely involved. Secondly, there is not much
controversy over the fact that the said motor cycle was owned by
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opponent No.1 and insured with opponent No.2 - appellant. Thirdly,
nor there is much dispute over the fact that the contract of
insurance was valid and subsisting. Fourthly, and most
significantly, Rama - PW-1, conceded in the cross examination that
opponent No.1 Uday, the insured, was his another son i.e. the
brother of the deceased. Fifthly, it is not the claim of the applicants
that the deceased was in the employment of opponent No.1 -
insured. On the contrary, it was the positive case of the applicants
that the deceased was employed as an inspector (Sampling) with
the company, Quality Services and Solutions, Goa.
6. In the light of the aforesaid facts, Mr. Mahadik the
learned counsel for the appellant strenuously submitted that the
applicants who claimed to be the dependents of the deceased are
not entitled in law to claim compensation even under the provisions
of Section 163-A of the MV Act, 1988. Amplifying the submission,
Mr. Mahadik, the learned counsel for the appellant, would urge that
the tribunal committed a manifest error in opining that since the
question of negligence was not required to be delved into in an
application under Section 163-A of the MV Act, 1988, the applicants
were entitled to compensation. Mr. Mahadik further submitted that
since there was no liability on the insurer to pay compensation
where the accident occurred due to the negligence of the insured
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himself, the insurer could not have been saddled with the liability.
To bolster up this submission, Mr. Mahadik, the learned counsel for
the appellant placed a strong reliance on the judgment of the
Supreme Court in the case of Ningamma and Another Vs. United
India Insurance Company Limited1, and the judgment of this Court
in the case of United India Insurance Co. Ltd V. Kirtikumar S/o
Mannalalji Lunawat, in First Appeal No.505 of 2013, dated
24th December, 2013.
7. In opposition to this, the learned counsel for the
respondent Nos. 1 to 5/original applicants endeavoured to support
the impugned judgment and award. Laying emphasis on the text of
the provisions contained in Section 163-A of the MV Act, 1988, Mr.
Patil submitted that the questions of negligence as well as to whom
the negligence was attributable are wholly irrelevant in an
application under Section 163-A of the MV Act, 1988. Thus, the
learned Member was justified in passing the impugned award,
submitted Mr. Patil
8. I have given a careful consideration to the aforesaid
submissions. In the backdrop of the uncontroverted facts,
extracted above, the primary question which arises for
consideration is the status of the deceased qua the insurer. Under
Section 147 of the MV Act, 1988, the policy of insurance, inter alia,
1(2009), 13 SCC 710
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covers cases against any liability which may be incurred by the
insured in respect of death or bodily injury to any person including
owner of the goods or his authorized representative carried in the
motor vehicle or damage to any property of a third party caused by
or arising out of the use of the motor vehicle in a public place.
There is, thus, a significant distinction as regards the liability of the
insurer. Where compensation is claimed in respect of the death or
bodily injury to a third party, the liability of insurer is unlimited. In
contrast, where the compensation is claimed for death of the owner
or another passenger of the vehicle, who can not be termed as a
third party, the liability of the insurer depends upon the terms of
contract. In the later case, in the absence of contract to pay
compensation for the death or injury to the insured and/or paid
driver, the insurer is not statutorily liable to pay compensation.
9. In the instant case, the tribunal, it seems, was not alive
to the distinction between the contractual liability and the
statutory liability of the insurer qua the third party. The tribunal
was swayed by the fact that the application was made under Section
163-A of the MV Act, 1988. Undoubtedly, if an application is made
under the special provisions contained in Section 163-A of the Act,
the claimant shall not be required to plead or establish that the
death or permanent disablement was due to any wrongful act or
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default of the owner of the vehicle or any other person. This,
however, does not imply that the insurer is liable to pay
compensation in cases where, it is neither statutorily liable nor has
contractually undertaken the risk.
10. Reliance placed by the learned counsel for the appellant
on the judgment of the Supreme Court in the case of Ningamma and
Another Vs. United India Insurance Company Limited 2, appears to
be well founded. In the said case also, the deceased was travelling
on a motor cycle which he had borrowed from its owner. The
deceased collided with bullock cart proceeding ahead and
succumbed to his injuries. The wife and son of the deceased filed an
application for compensation under Section 163-A of the MV Act,
1988. The tribunal was persuaded to award compensation. In
appeal, the judgment and award passed by the tribunal was set
aside by the High Court. The claimants preferred an appeal before
the Supreme Court.
11. The Supreme Court adverted to the provisions of
Section 163-A of the MV Act, 1988, and the object behind
introducing the said provision. It was, inter alia, observed that it is
in the nature of a social security measure. It is a Code by itself.
After adverting to the previous pronouncements dealing with
2(2009), 13 SCC 710
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Section 163-A of the MV Act, 1988, the Supreme Court held that, if
the owner himself happened to be the driver of the vehicle, the
owner could not himself be a recipient of compensation as the
liability to pay the same is on him. The legal representatives of the
deceased who have stepped into shoes of the owner of the motor
vehicle could not have claimed compensation under Section 163-A
of the MV Act, 1988.
12. The observations of the Supreme Court in Paragraph
Nos. 19 to 23 are instructive and hence extracted below.
"19. In Oriental Insurance Company Ltd. v. Rajni Devi and
Others, (2008) 5 SCC 736, wherein one of us, namely, Hon'ble
S.B. Sinha, J. was a party, it has been categorically held that in a
case where third party is involved, the liability of the insurance
company would be unlimited. It was also held in the said
decision that where, however, compensation is claimed for the
death of the owner or another passenger of the vehicle, the
contract of insurance being governed by the contract qua
contract, the claim of the claimant against the insurance
company would depend upon the terms thereof.
20. It was held in Oriental Insurance Company Ltd. case,
(2008) 5 SCC 736 that Section 163-A of the MVA cannot be said
to have any application in respect of an accident wherein the
owner of the motor vehicle himself is involved. The decision
further held that the question is no longer res integra. The
liability under section 163-A of the MVA is on the owner of the
vehicle. So a person cannot be both, a claimant as also a
recipient, with respect to claim. Therefore, the heirs of the
deceased could not have maintained a claim in terms of Section
163-A of the MVA.
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21. In our considered opinion, the ratio of the aforesaid
decision in Oriental Insurance Company Ltd. case, (2008) 5 SCC
736 is clearly applicable to the facts of the present case. In the
present case, the deceased was not the owner of the motorbike
in question. He borrowed the said motorbike from its real owner.
The deceased cannot be held to be employee of the owner of the
motorbike although he was authorised to drive the said vehicle
by its owner, and, therefore, he would step into the shoes of the
owner of the motorbike. We have already extracted Section 163-
A of the MVA hereinbefore. A bare perusal of the said provision
would make it explicitly clear that persons like the deceased in
the present case would step into the shoes of the owner of the
vehicle.
22. In a case wherein the victim died or where he was
permanently disabled due to an accident arising out of the
aforesaid motor vehicle in that event the liability to make
payment of the compensation is on the insurance company or
the owner, as the case may be as provided under Section 163-A.
But if it is proved that the driver is the owner of the motor
vehicle, in that case the owner could not himself be a recipient
of compensation as the liability to pay the same is on him. This
proposition is absolutely clear on a reading of Section 163-A of
the MVA. Accordingly, the legal representatives of the deceased
who have stepped into the shoes of the owner of the motor
vehicle could not have claimed compensation under Section 163-
A of the MVA.
23. When we apply the said principle into the facts of the
present case we are of the view that the claimants were not
entitled to claim compensation under Section 163-A of the MVA
and to that extent the High Court was justified in coming to the
conclusion that the said provision is not applicable to the facts
and circumstances of the present case."
(emphasis supplied)
13. A profitable reference can also be made to the judgment
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of the Supreme Court in the case of Oriental Insurance Co. Ltd. Vs.
Rajani Devi and Ors3. In the said case, an application under Section
163-A of the MV Act, 1988 was filed by the dependents claiming
compensation for the death of Janak Raj. It was claimed that he
was riding on a motorcycle along with one Sukhdev Raj. However,
who was actually driving the motor cycle was not clear. In the facts
of the said case, the tribunal proceeded to determine the issue of
tenability of the application under Section 163-A of the MV Act,
1988 on the premise that comprehensive insurance policy having
been taken, what was required to be seen was the use of motor
vehicle irrespective of the fact as to whether the deceased or the
Sukhdev Raj was driving the motor cycle or not.
14. The Supreme Court observed that, the tribunal was not
justified in taking the said view. Observations in Para No.7 are
material.
" 7. It is now a well-settled principle of law that in a
case where third party is involved, the liability of the
insurance company would be unlimited. Where, however,
compensation is claimed for the death of the owner or
another passenger of the vehicle, the contract of insurance
being governed by the contract qua contract, the claim of
the insurance company would depend upon the terms
thereof. The Tribunal, in our opinion, therefore, was not
correct in taking the view that while determining the
amount of compensation, the only factor which would be
relevant would be merely the use of the motor vehicle."
3 (2008) 5 SCC 736
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15. After observing thus and adverting to the provisions
contained under Section 163-A of the MV Act, 1988, and the
previous pronouncements of the Supreme Court in the cases of
Oriental Insurance Co. Ltd. Vs. Jhuma Saha 4 and in National
Insurance Co. Ltd. Vs. Laxmi Narain Dhut 5, the Supreme Court held
that the provisions contained in Section 163-A cannot be said to
have any application in regard to an accident wherein, the owner of
the motor vehicle himself is involved. Since the liability under
Section 163-A of the Act is of the owner of the vehicle, a person
cannot be both the owner and also a recipient. The heirs of Janak
Raj could not have thus maintained the claim in terms of Section
163-A of MV Act. For the said purpose, only the terms of the
contract of insurance could be taken resort to.
16. This position was further expounded by the Supreme
Court in a recent decision in the case of Ramkhiladi and Another
Vs. United India Insurance Company and Another6. In the facts of
the said case, the Supreme Court formulated the question thus :-
" 9. ..........whether, in the facts and circumstances of
the case and in a case where the driver, owner and the
insurance company of another vehicle involved in an
accident and whose driver was negligent are not joined as
parties to the claim petition, meaning thereby that no claim
petition is filed against them and the claim petition is filed
only against the owner and the insurance company of
4 (2007) 9 SCC 263 : (2007) 3 SCC (Cri) 443 : AIR 2007 SC 1054
5 (2007) 3 SCC 700 : (2007) 2 SCC (Cri) 142
6 (2020) 2 SCC 550
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another vehicle which was driven by the deceased himself
and the deceased being in the shoes of the owner of the
vehicle driven by himself, whether the insurance company
of the vehicle driven by the deceased himself would be
liable to pay the compensation under Section 163A of the
Act?; Whether the deceased not being a third party to the
vehicle No. RJ 02 SA 7811 being in the shoes of the owner
can maintain the claim under Section 163A of the Act from
the owner of the said vehicle? "
17. After adverting to the previous pronouncements,
including the judgment in the case of Ningamma (Supra), the
Supreme Court answered the question in the negative in the
following words.
" 9.5 It is true that, in a claim under Section 163A of
the Act, there is no need for the claimants to plead or
establish the negligence and/or that the death in respect of
which the claim petition is sought to be established was due
to wrongful act, neglect or default of the owner of the
vehicle concerned. It is also true that the claim petition
under Section 163A of the Act is based on the principle of
no-fault liability. However, at the same time, the deceased
has to be a third party and cannot maintain a claim under
Section 163A of the Act against the owner/insurer of the
vehicle which is borrowed by him as he will be in the shoes
of the owner and he cannot maintain a claim under Section
163A of the Act against the owner and insurer of the
vehicle bearing registration No. RJ 02 SA 7811. In the
present case, the parties are governed by the contract of
insurance and under the contract of insurance the liability
of the insurance company would be qua third party only. In
the present case, as observed hereinabove, the deceased
cannot be said to be a third party with respect to the
insured vehicle bearing registration No. RJ 02 SA 7811.
There cannot be any dispute that the liability of the
insurance company would be as per the terms and
conditions of the contract of insurance. As held by this
Court in the case of Dhanraj V. New India Assurance Co.
Ltd, (2004) 8 SCC 553 : 2005 SCC (Cri) 363, an insurance
policy covers the liability incurred by the insured in
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respect of death of or bodily injury to any person (including
an owner of the goods or his authorized representative)
carried in the vehicle or damage to any property of a third
party caused by or arising out of the use of the vehicle. In
the said decision, it is further held by this Court that
Section 147 does not require an insurance company to
assume risk for death or bodily injury to the owner of the
vehicle.
9.6 In view of the above and for the reasons stated
above, in the present case, as the claim under Section 163A
of the Act was made only against the owner and insurance
company of the vehicle which was being driven by the
deceased himself as borrower of the vehicle from the owner
of the vehicle and he would be in the shoes of the owner, the
High Court has rightly observed and held that such a claim
was not maintainable and the claimants ought to have
joined and/or ought to have made the claim under Section
163A of the Act against the driver, owner and/or the
insurance company of the offending vehicle i.e. RJ 29 2M
9223 being a third party to the said vehicle. "
(emphasis supplied)
18. In the light of the aforesaid exposition of law, reverting
to the facts of the case, the deceased, who had borrowed the vehicle
from his brother, stepped into the shoes of the owner. As indicated
above, the deceased was not in the employment of the owner of the
vehicle. Consequently, the deceased was not a third party qua the
insurer.
19. In this view of the matter, dependents of the deceased
could not have legitimately maintained an application for
compensation under Section 163-A of the MV Act, 1988.
20. So far as the contractual liability, it is imperative to note
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that the policy of insurance (Exh.32), which was placed on record
by the insurer/appellant, reveals that the premium was paid under
the head compulsory p.a. owner - cum - driver and the liability was
restricated to Rs. 1 Lakh. The learned counsel for the applicants
endeavoured to canvass a submission that consequent to
amendment in the Second Schedule, a fixed amount of Rs. 5 Lakhs
had been specified in case of death and, therefore, the applicants
are entitled to a sum of Rs.5 Lakhs. In the instant case, the accident
took place on 30th June, 2007. The impugned judgment and award
was passed on 19th May, 2012. In the circumstances, the applicants
would not be entitled to receive the compensation in terms of the
amendment to the Second Schedule, which came into effect from
22nd May, 2018. This aspect is also covered by the judgment of the
Supreme Court in the case of Ramkhiladi (Supra) wherein an
identical submission was repelled.
21. The conspectus of the aforesaid consideration is that the
respondent Nos. 1 to 5 - applicants are entitled to compensation of
Rs. 1 Lakh in terms of the contract of insurance, Resultantly, the
appeal deserves to be partly allowed.
22. Hence, the following order :
ORDER
i. The appeal stands partly allowed.
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ii. The impugned judgment and award in M.A.C.P. No. 35 of
2009 dated 19th May, 2012 stands modified as under :
The appellant - original opponent No.2 - insurer
shall pay an amount of Rs. 1 Lakh along with interest @
8 % per annum from the date of the application and
proportionate costs to the applicant.
iii. In case the opponent No.2/appellant has already
deposited the amount of compensation in terms of the
impugned judgment and award, the balance amount
excluding the amount of Rs.1 Lakh and interest accrued
thereon, be refunded to the opponent No.2/Appellant.
iv. In the circumstances, the parties shall bear their
respective costs of this appeal.
v. Award be drawn accordingly.
vi. In view of disposal of appeal, Civil Application stand
disposed of.
(N. J. JAMADAR, J.)
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